A couple weeks ago I posted a blog entitiled What are reasonable fees for a Ministry construction project? . This raised a great number of responses from several ends of the spectrum of contractors, consultants, architects, engineers and church leaders.

I want to share some of the comments with you with….the names of the contributor are not listed (to protect the innocent ) but I have listed their field of endeavor. Check these out…but make sure you don’t miss my conclusion at the bottom:

“A Flat fee based upon only the scope needed. NOT a % of construction – conflict of interest since they effect the budget with everything they do.” from an architect

“Since fees are generally for services the main question in my mind for churches is ‘How does this firm or company demonstrate they are the best qualified firm charging a fair fee to perform services we need to result in a successful project”. The typical negative response declared by churches regarding architectural services is that the architect designed a building that catered to all of our wants (not needs) and ended up costing twice what we could afford. Now those plans are sitting in the corner of the pastors office.” from an architect

“Fees for Services Performed can vary depending on several factors. For example, each delivery method has a different fee structure. Construction management (CM) has a rather low fee but unusually high reimbursable costs that can negate the low fee. Design-Build has what appears to be a higher fee than low bid “but” the D-B fee includes both the design fee as well as the construction fee. When compared on an equally basis design-build has the lowest overall fee of all three delivery methods.

The greatest factor that impacts fees is risk to the contractor is taking. Put simply, low risk = low fee, high risk = higher fees. When done correctly design-build lowers the risk for both the owner and builder and results in lower fees and lower construction cost.

Cost of Construction is a very relative thing and must be compared against similar projects to develop a “reasonable” amount. I have seen ministry projects build for $250/sf and considered them reasonable when compared against similar projects. I have also seen $100/sf project where I thought the church overpaid for what they received.

One of the best approaches to determining “reasonable” is for the owner and design-builder to agree upon a number or % up front and for the D-B to perform their work open-book. This is how my firm operates and will continue to do so

from a Design/build contractor (and no…it is not from my former employer)

“The big question to me is this a one shot building or are we talking a long term construction plan with several phases that may take years to complete?
We recently did a project where Phase 1 was constructed, but parking and ground work for Phase 2 was also completed.
Turn-Key construction or member participation?
Are you only serving in a construction management function or are you also the GC?
Is the land already purchased or are you also involved in site selection?
Is the funding in place or are you involved in the raising of funds?”

To me all these questions could effect your fee structure.

from a product vendor

“I have often thought that voodoo was a part of fee determination, as there seems to be little science behind it. I also call General Conditions the “nebulous black hole.” I do feel, however, that when a firm (design or construction) brings a certain skill set, talent, or level of experience, they are justified to charge a little more. Maybe they are good designers, maybe they are particularly adept at production of construction documents–which leads to lower, or no, change orders for an owner. It depends on what the client values. The trick is then putting a dollar number on that increased value. Simply having an architectural license does not make all designers equal. Same thing on the GC side.”
from an architect

“It takes a knowledgable, educated client to understand that their goal should be to select the firm/contractor that offers the best value. And unless that client has direct past experience that they can rely on, then it requires a process of due diligence and evaluation.”
from an architect

It’s about priorities. And those priorities are as vast and different as the people we serve. This is particularly evident in the product selections and levels of acceptable workmanship seen from one project to the next.
In short, it’s about understanding and meeting/exceeding the expectations of the client. What’s maybe more important is educating the client. When trouble comes along the “value” builder takes no financial liability and the high priced guy may just eat a few cost along the way.”
from a church leader

I really appreciate all of the input and comments that we received. There were many more, but most followed similar lines of thinking.  Many of you who read the initial post also realized that I was asking the questions in a rhetorical manner.  I realize there is no “set” or universal fee for architects or engineers or contractor.  However, understanding that having the RIGHT partners….that provide the RIGHT value…and provide the RIGHT amount of expertise/experience, is worth something.  The question is…how much?  This is where due diligence, seeking wisdom and advice are the prudent steps to take.  There is also the intangible factors that you must consider which include:

1. Are they the right cultural fit for our ministry?

2. Do the “get” us? Do they understand our DNA, Vision and Target Market?

3. Have they working in a Team environment before…or within our selected delivery method for the project?

4. Is this a “job/project” for them or are they passionate about serving you and serving God’s kingdom.

These are major decisions…do not take them lightly.

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